A FranNet Business operates as a third-party franchise-consulting and referral network. The FranNet franchisee recruits and consults with prospective franchise buyers (“Prospects”), matches them with FranNet-approved “Franchisors,” and supports the investigation. When a referred Prospect signs with a represented Franchisor and a referral fee is paid, FranNet administers the franchisee’s commission.
The FranNet Business converts qualified Prospects into introductions to approved Franchisors. The franchisee performs consulting, relationship-building and follow-up; FranNet, LLC controls Franchisor inventory, contracts, Operations Brand Standards Manuals, lead rules, required CRM and reporting. Represented Franchisors supply the opportunities and fund referral compensation after qualifying transactions.
What does a FranNet franchisee actually sell, and who buys it?
The franchisee provides consulting and referral Services to Prospects exploring franchise ownership. The Prospect ultimately buys a franchise, license, business opportunity or re-sale from an approved Franchisor, not from the franchisee.
The 2026 FDD defines the Franchised Business as a third-party referral network. The franchisee recruits and meets Prospects, exchanges information to identify suitable opportunities, and represents approved Franchisors in certain sales transactions. The Operations Brand Standards Manual reinforces that role with the Service Standards topic “Referring not Selling.”
The payment path is separate from the Prospect-service path. When a referred Prospect enters a Franchise Agreement with a represented Franchisor and that Franchisor pays FranNet a referral fee, the receipt is “Gross Consulting Income.” FranNet then pays the franchisee under the Agreement; the franchisee generally may not take FranNet-entitled compensation directly from a Franchisor without written consent.
Basis: 2026 FranNet FDD, Item 1, pp. 2-3; Item 6, pp. 6-8; Franchise Agreement Section 3 and Exhibit A; Operations Brand Standards Manual TOC, Chapters 3-4.
How does work move from a lead to a completed referral?
The disclosed path is lead generation and routing, Prospect consultation, matching to an approved Franchisor, guided investigation and follow-up, then Franchisor-paid referral compensation and recordkeeping. The franchisee performs client-facing work; FranNet controls Franchisor inventory, lead rules, standards and compensation administration.
Acquire or receive the lead
- Actor
- Franchisee, FranNet Marketing Program and lead sources
- Action
- Generate Prospects through networking, seminars, referrals, local activity, National Relationships and internet sources.
- System/asset
- Lead disbursement rules, FranNet website channels and required CRM.
- Output
- A Prospect assigned or originated for follow-up.
Consult and qualify
- Actor
- Trained franchisee or approved consultant
- Action
- Conduct client meetings, follow-up and the FranNet Process; develop the Entrepreneurial Profile and discuss funding considerations.
- System/asset
- Operations Brand Standards Manuals, CRM and proprietary process materials.
- Output
- A documented Prospect profile and search criteria.
Match to approved inventory
- Actor
- Franchisee, within FranNet approval rules
- Action
- Match the Prospect with Franchisors in FranNet’s approved inventory and prepare introductions.
- System/asset
- Approved Franchisor inventory and FranNet matching methodology.
- Output
- Approved Franchisor candidates for investigation.
Guide the investigation
- Actor
- Franchisee, Prospect and represented Franchisor
- Action
- Coordinate introductions, Franchisor calls, research and the High Touch Process while the Prospect makes the ownership decision.
- System/asset
- CRM, client meeting process and approved communications.
- Output
- A Prospect that advances, pauses or exits the investigation.
Close the referral path
- Actor
- Prospect, represented Franchisor and FranNet, LLC
- Action
- If the Prospect signs with the Franchisor, the Franchisor pays the contractual referral compensation to FranNet.
- System/asset
- FranNet-negotiated Franchisor contract and Gross Consulting Income rules.
- Output
- Received Gross Consulting Income attributable to the franchisee.
Commission, record and follow up
- Actor
- FranNet and franchisee
- Action
- FranNet pays commissions weekly after receipt; the franchisee keeps required books, transaction data and reports and performs post-sale follow-up.
- System/asset
- CRM, records and reporting requirements.
- Output
- Closed transaction record, compensation and ongoing compliance record.
Basis: 2026 FranNet FDD, Items 1, 6, 11 and 16, pp. 2-3, 6-8, 12-16 and 19; Franchise Agreement Sections 3, 11-12; Manual TOC, Chapters 4-6.
A franchisee cannot independently add a Franchisor. FranNet must approve represented Franchisors and negotiates their contracts; a regional or local opportunity outside FranNet’s approved inventory requires written consent before the franchisee provides Services.
Can the FranNet Business be manager-run or absentee?
The 2026 FDD does not support an absentee operating claim. The FranNet franchisee, or at least one trained principal when the franchisee is an entity, must participate personally in direct operation as supervisor and manager.
The on-premises supervisor must complete initial training. Additional sales personnel are permitted only with FranNet approval, a written agreement involving FranNet and the franchisee, and compliance with FranNet training and professional standards. Employees or associates who communicate or meet with Prospects must complete required training first.
A dedicated office separate from home is not required, and FranNet does not select the office site. The franchisee chooses the workplace arrangement, but direct supervision, training, confidentiality and approval of Prospect-facing personnel remain governed by the Agreement and Manuals.
Basis: 2026 FranNet FDD, Item 11, pp. 12-16; Item 15, pp. 18-19; Franchise Agreement Sections 2.4, 4 and 13.6.
Where do Prospects come from, and how much territory protection exists?
New FranNet franchisees receive no exclusive or protected territory. They may generally work with Prospects regardless of domicile and use direct-marketing channels, but legacy protected territories, National Relationships and FranNet’s internet-lead disbursement policy create specific routing restrictions.
Prospects can come from networking, referrals, seminars, webinars, represented Franchisors, the FranNet Marketing Program and internet sources. The Manual TOC also identifies chambers, business schools, outplacement firms, SCORE and Small Business Development Centers as client-acquisition channels.
Purchased leads and other FranNet-generated internet leads route through the lead disbursement system under the internet lead policy. National Relationships follow separate rules, and legacy protected territories can restrict who may work a Prospect or participate in local job fairs and expos. FranNet may also grant other FranNet Businesses without regard to proximity and use other distribution channels.
Local marketing is a franchisee responsibility within System controls. The Franchise Advisory Council administers the FranNet Marketing Program; unapproved advertising requires review, social media follows FranNet policy, and a separate public website for the FranNet Business requires advance written approval.
Basis: 2026 FranNet FDD, Item 11, pp. 13-16; Item 12, pp. 16-17; Franchise Agreement Section 11.
Which operating systems and supplier relationships are mandatory?
The core mandatory input is technology, not physical inventory: a capable computer with high-speed internet, FranNet-required Software, and the designated CRM vendor. FranNet may also designate suppliers or specifications for other FranNet Business inputs.
CRM and communications
The franchisee maintains suitable computer hardware and uses the CRM vendor. The Agreement treats the Software, templates and training tools as confidential and permits suspension of Software, email or microsite access for specified noncompliance.
Supplier approval
If FranNet designates one supplier, the franchisee needs prior written consent for an alternative. FranNet may approve, inspect or revoke supplier approval; the 2026 FDD says neither FranNet nor an affiliate is currently an approved supplier.
Records and audit
The Agreement requires full, accurate books and records for at least three years. FranNet and designated agents may examine and copy FranNet Business records, require reports and conduct an independent audit.
Contact information
During the term, the franchisee may control and manipulate Contact Information it inputs into the Software. At termination, both FranNet and the franchisee may retain a copy of that Contact Information under the Agreement.
Basis: 2026 FranNet FDD, Item 8, pp. 10-11; Item 11, pp. 14-16; Franchise Agreement Sections 10.5, 11.10 and 12.
What does FranNet control, and what remains with the franchisee?
FranNet controls System boundaries; the franchisee controls execution within them. Represented Franchisors, National Relationships and the designated CRM vendor are external dependencies governed by the Agreement, Manuals or written lead policies.
Franchisee
- Build local referral relationships and conduct approved FranNet Business marketing.
- Meet, qualify, match and follow up with Prospects under the FranNet Process.
- Choose the workplace arrangement; maintain computer hardware, insurance, FranNet Business records and reports.
- Hire or engage Prospect-facing personnel only within FranNet approval and training rules.
FranNet, LLC
- Approves Franchisors and negotiates contracts governing represented opportunities.
- Maintains and revises the Manuals and brand specifications.
- Sets internet lead policy, website, advertising, CRM and reporting requirements.
- Administers Gross Consulting Income and commission payments and retains audit rights.
External dependencies
- Represented Franchisors provide the franchise opportunities and pay referral compensation when due.
- National Relationships and internet sources feed Prospects subject to FranNet routing policies.
- The CRM vendor supplies the required customer relationship management platform.
- The Franchise Advisory Council administers the FranNet Marketing Program.
Basis: 2026 FranNet FDD, Items 6, 8, 11, 12, 15 and 16, pp. 6-8, 10-19; Franchise Agreement Sections 3, 5 and 10-12.
What does Item 20 show about the FranNet outlet base?
Item 20 reports an entirely franchised U.S. outlet base for 2023-2025, with no company-owned outlets. Year-end franchised outlets declined from 69 in 2023 to 64 in 2024 and 58 in 2025.
Interpretation: the year-end franchised count fell by 11 outlets, or 15.9%, from 2023 to 2025; Item 20 separately reports one opening and seven terminations during 2025.
Source: 2026 FranNet FDD, Item 20, Table 1, p. 24, and Table 3, pp. 25-28. Reporting date: December 31, 2025.
Item 20 does not disclose why the seven 2025 terminations occurred. The counts establish a system-footprint change, not its cause; current and former franchisee interviews are needed to test what operating factors, if any, sit behind the decline.
Which operating questions remain worth verifying before signing?
The largest remaining uncertainties sit in the Manuals or current written policies: the designated CRM vendor, exact internet lead policy, National Relationship rules, the Franchise Agreement production quota, and the workload required for direct principal participation.
- ✓Review current Manuals sections for the FranNet Process, internet lead policy, National Relationships, marketing tracking, reports and staffing.
- ✓Confirm the CRM vendor, integrations, data-export process, Software suspension triggers and changes FranNet can mandate during the term.
- ✓Obtain the proposed agreement’s production schedule and confirm whether the quota uses dollars, number of deals or another measure.
- ✓Review legacy protected territories and test how purchased, internet, referral and National Relationship leads route in the intended market.
- ✓Interview current and former franchisees about Prospect volume, networking versus consultation time, approved personnel and changes to System requirements.
Official public operating references
- FranNet official U.S. website
- FranNet franchise-owner operating overview
- FranNet consumer consulting process
- FranNet Franchisor inventory process
- FranNet Client Bill of Rights
- FranNet initial consultation process
- FranNet matching and investigation process
Primary contractual evidence: 2026 FranNet FDD, Items 1, 6, 8, 11, 12, 15, 16, 19 and 20; Franchise Agreement; Operations Brand Standards Manual TOC.